Global Crisis Period Research Articles

You sneeze, and the markets are paranoid: the fear, uncertainty and distress sentiments impact of the COVID-19 pandemic on the stock–bond correlation

PurposeThis paper investigates the influence of three different sentiment indicators on the time-varying stock–bond correlation of 15 countries during the global crisis period of the coronavirus disease 2019 (COVID-19) pandemic.Design/methodology/approachThe author uses the time-varying correlation estimated using the autoregressive moving average -dynamic conditional correlation - generalised autoregressive conditional heteroskedasticity (ARMA-DCC-GARCH) model to achieve this aim. The impact of investor sentiment on the stock–bond correlation was analysed using the Markov regime-switching regression.FindingsThe study results show that the sentiment indicators of fear, uncertainty and distress have a pronounced negative impact on the stock–bond correlation. They further provide evidence of a strong regime effect on the stock–bond correlation with sentiment indicators.Practical implicationsThe paper has a relevant impact on policymakers and fund managers. First, the policymakers now have more insightful evidence of how the stock and bond markets react during crises. Second, the fund managers need to focus on behavioural variables as they may be driving factors in crisis periods that may impair portfolio management.Originality/valueTo the best of my knowledge, the paper is the first to throw light on the behaviour of the stock–bond correlation for 15 countries during the COVID-19 period.

Remittances Flow to India: Trends and Determinants

This paper investigates the trends in flow of remittance to India using Semi-log Linear Model on the data set starting from 2000 to 2011. We divide the entire dataset into Pre global economic crisis period (2000-2007) and Post global economic crisis period (2008-11). Our result reveals that the flow of remittances is declined during the post global economic crisis period. Amongst the Asian countries under the study and whose immigrants have larger presence in USA, Europe and Middle East, remittance flow coming from them to India and China is severely affected due to recession in these countries. However, Pakistan, Bangladesh, Nepal are not much affected because of their workers are not in information technology sector and in the high skilled industries.

Framework for Dynamic Modelling of the Dam and Reservoir System Reduced Functionality in Adverse Operating Conditions

Dam and reservoir systems (DRSs) are crucial aspects of the infrastructure necessary for reliable water resource management. Nowadays, DRSs are being increasingly affected by numerous natural and anthropogenic impacts (aging and outdated infrastructure, climate change, natural hazards, global crises, etc.). Hence, additional pressure on DRS management is being applied as DRSs must be operated in adverse operating conditions, outside of their design envelopes. Since there is no practical way to redesign DRSs to meet all possible adverse conditions, efficient simulation tools are necessary for various “what-if” analyses. A system dynamics (SD) approach can be used, as it has shown the capacity to comprehend the intrinsic system complexity. In this paper, an 11-step framework for the dynamic modelling of reduced functionality in a DRS and the emulation of the system operation in adverse conditions is proposed. The framework covers the system model design, input scenario generation, system simulation, and performance evaluation steps. A focus is placed on the steps related to system decomposition, the identification of failure-indicative parameters, the definition and implementation of failure functions in the subsystem dynamic models, and dynamic failure modelling. Through these steps, a novel procedure is proposed for the dynamic modelling of the DRS subsystems’ failures (reduced functionality), common in the operation of DRSs under adverse conditions. For each subsystem prone to failure, failure-indicative parameters are identified. Failure functions employing generic functionality indicators, with values spanning from 0 to 1, are suggested to modify the values of the failure-indicative parameters in simulations and emulate the component failure impacts on DRS operation. Possibilities for modelling failure modes for different subsystems, varying in nature, duration, and magnitude are discussed. Potential physical damage to the system components, increases in measurement uncertainty, and the lack of the spare parts during periods of global crisis are applied as disturbances to the Pirot DRS case study to illustrate the possibilities of the suggested framework’s application for DRS failure modelling. It was concluded that the proposed framework allowed for the detection of severe impacts on system performance, emphasizing the need for DRS dynamic failure modelling in system analysis.

Optimal carry trade portfolio choice under regime shifts

This paper studies optimal currency allocation of the carry trade in foreign exchange (FX). A number of empirical studies have documented a phenomenon referred to as the ‘forward premium puzzle’, which states that the carry trade is profitable on average. However, the carry reversal during the 2008 global crisis periods wiped out the profits earned by the trade. To account for the regime shifts in the joint distribution of returns on the carry trade with FX market portfolios, we adopt a Markov regime switching model. We find evidence of two economic regimes: one state captures periods of the forward premium puzzle and UIP being violated, whilst the other reports high FX volatility and negative return of carry trade portfolio. Furthermore, to quantify the economic significance of regimes in returns on currency portfolios, we consider their importance in investors’ optimal portfolio allocation problem. We find strong evidence that optimal currency portfolio holdings vary significantly across regimes and across short and long investment horizons, as investors anticipate a shift out of the current state. Our results also show that the regimes partially anticipate peso events as well as the changes of funding liquidity measured by the TED spreads. A strategy that accounts for regimes, thus, generates overall stronger performance than the single-state Gaussian IID model, a carry trade procedure as well as a buy-and-hold strategy.

Understanding Residents' Physical Activity Intention and Behavior Amid COVID-19 Pandemic.

Proper and regular physical activity (PA) plays an important role in improving people’s health. With the outbreak of the COVID-19 pandemic, which has posed a serious threat to individual health, residents’ PA has aroused deep concern. Based on the theory of planned behavior, this study examines the impact of residents’ PA intention and behavior in response to the COVID-19 pandemic. Data were collected from a sample of 961 residents in Wuhan in China using a questionnaire survey. The results show that residents’ PA intention and behavior have been affected significantly by residents’ PA attitude, subjective norms, and perceived behavioral control. The COVID-19 pandemic has a significant impact on both residents’ PA intention and behavior. In addition, there were gender and region differences in this impact. The findings are of great significance in promoting residents’ PA intention and PA behavior, which are of positive significance to the development of residents’ physical and mental health in the period of global serious health crisis.

Incidence of Corporate Income Tax: Estimates from Indian Manufacturing Firms


 
 
 
 The purpose of this paper is to examine the incidence of corporate tax on capital and labour in Indian manufacturing sector. The paper employs ‘Seemingly Unrelated Regression Method’ with add-up restriction based on the work of Desai, Foley and Hines (2007). The study shows that, for the manufacturing sector in India for the period 2005-19, the corporate tax has a significant adverse impact on both wages paid to employees and profit after tax. Capital owners bear 96.3% of the tax burden and labours bear only 3.7%. The adverse effect on wages is slightly higher in public firms than in private firms. The relative tax burdens of labour and capital remained the same in the pre-2008 global economic crisis and post-crisis periods. The impact on both wages and profits increase with age and size of firms but decrease with leverage. These results will be useful to policymakers and other stakeholders to take appropriate strategies to design the corporate tax policy such that it is more redistributive, and not a burden for labour in manufacturing firms in India. The paper contributes to the scant empirical literature on corporate tax incidence.
 
 
 

Jurnalism științific. Cum a schimbat pandemia de Covid 19 raportul dintre jurnalism și știință?

The pandemic crisis has made the relationship between journalism and science, particularly in the medical and public health spheres, more strained than ever. In an unexpected way, professional journalists have had to re-evaluate and filter information, data, opinions and consider the international scientific community and research findings. Studies show that health journalism becomes credible and responsible when it contextualises events and documents material based on experts, medical authorities, prestigious research institutions, studies validated by international evaluations, etc. The period of global health crisis has highlighted more than ever the role and responsibility of professional journalism, its reporting to relevant research sources and its inherent links to science. This theoretical article aims to highlight key concepts such as science journalism and to exemplify how they are reflected in Romanian health journalism practices.

Burnout Among Healthcare Workers in the COVID 19 Era: A Review of the Existing Literature.

In the current period of global public health crisis due to the COVID-19, healthcare workers are more exposed to physical and mental exhaustion – burnout – for the torment of difficult decisions, the pain of losing patients and colleagues, and the risk of infection, for themselves and their families. The very high number of cases and deaths, and the probable future “waves” raise awareness of these challenging working conditions and the need to address burnout by identifying possible solutions. Measures have been suggested to prevent or reduce burnout at individual level (physical activity, balanced diet, good sleep hygiene, family support, meaningful relationships, reflective practices and small group discussions), organizational level (blame-free environments for sharing experiences and advices, broad involvement in management decisions, multi-disciplinary psychosocial support teams, safe areas to withdraw quickly from stressful situations, adequate time planning, social support), and cultural level (involvement of healthcare workers in the development, implementation, testing, and evaluation of measures against burnout). Although some progress has been made in removing the barrier to psychological support to cope with work-related stress, a cultural change is still needed for the stigma associated with mental illness. The key recommendation is to address the challenges that the emergency poses and to aggregate health, well-being and behavioral science expertise through long term researches with rigorous planning and reporting to drive the necessary cultural change and the improvement of public health systems.

Impact of fiscal transfers policy on regional growth convergence in India

This study is an attempt to empirically analyze the effect of fiscal transfers on growth and regional growth convergence in India during 2005–2019, using the standard growth convergence model for panel data. Results indicate the growth convergence across Indian States. The regional income gaps reduced at a rate of 17.7–31.9% per annum. The fiscal transfers contribute to the growth of 22 out of 29 States and also contribute significantly to the convergence. Moreover, there is strong evidence for convergence across General Category States and across Special Category States. The average income growth is higher in Special Category States and higher in post global crisis period. It is our hope that these results will be useful to policymakers and other stakeholders to take appropriate strategies to design fiscal transfer policy such that it will speed up the convergence process in India.

Bank Competition–Stability Relations in Pakistan: A Comparison between Islamic and Conventional Banks

This study comparatively analyses the financial stability of Islamic and conventional banks in Pakistan. Using data of 29 conventional and 9 Islamic banks over 18 years, the study first estimates bank competition and stability using Lerner index and Z-Score, respectively. Generalized least squares regression is used and the coefficients are estimated by using random-effects estimator. Results of the mean comparison show that Islamic banks carry more market power (less competition) and are more stable compared to their conventional counterparts. Results of a panel regression show that competition positively affects the stability of the banking sector and this effect is higher for Islamic banks due to their market power. Results also show that bank stability in Pakistan was reduced during global crisis period; however, presence of Islamic banks contributes to the stability even during crisis. Finally, this study supports the competition-stability hypothesis for Islamic banking in Pakistan. Recommendations are given at the end.

MODELING SOUTH AFRICAN STOCK MARKET VOLATILITY USING UNIVARIATE SYMMETRIC AND ASYMMETRIC GARCH MODELS

Contemporary empirical literature is rich in studies that have modelled and forecasted the nature and behavior of volatility of equity returns in both emerging and advanced stock markets. Modelling and estimating volatility is crucial in dynamic risk management, equity valuation and portfolio diversification. However, South African financial markets have not received ample attention in this regard. It is against this backdrop that we sought to determine the nature and behavior of volatility inherent in the South African stock market. Furthermore, we examined the effect of the 2014 global oil crisis on the volatility spillover in this market. The FTSE/JSE Top 40 index of the Johannesburg Stock Exchange has been selected as the study sample. Sample data for the period spans from October 14, 2009 to December 31, 2019, wherein the crisis period is from March 03, 2014 to February 27, 2015. Conditional volatility has been modelled and estimated using GARCH (1.1), GARCH-M (1.1), TGARCH (1.1) and EGARCH (1.1). The log likelihood, Akaike Information Criterion and Bayesian Information Criterion have been followed for model selection. The results showed that the EGARCH model is the most suitable for predicting the behavior of equity returns including for the global oil crisis period. JEL Classification Codes: C01, C13, C52, C53, C87.

Post traumatic growth during COVID-19: unity in diversity

AimsThis poster reflects how the experience of staying with people of diverse nations and cultural background helped the stranded IMGs cope with this agony in a foreign land during an unprecedented tumultuous situation. The aim is to show that despite diversity among people, the hard times made them unite and overcome countless difficulties.BackgroundThe COVID 19 pandemic has been a period of global health crisis and has exponentially affected mental health issues in the world population. In these difficult times, several International Medical Graduates (IMGs), who had come to the UK to attend their PLAB exams, were left stranded as the exams were postponed, flights cancelled and borders sealed. Faced with huge uncertainty their mental health was of great concern.At this time the British Association of Physicians of Indian Origin (BAPIO) came forward to help this cohort of stranded doctors in terms of accommodation, finances, mental health support, preparation for exams to the extent of liaising with General Medical Council (GMC) and Home Office. The virtual support group provided a platform for IMGs from different nations and cultures to get in touch with each other helping overcome mental burden and stress.The stories presented in the poster show how unity in diversity helped these young doctors deal with mental trauma amidst the Pandemic.Method276 doctors from 27 countries were looked after by BAPIO. From those excerpts taken from 26 IMGs, personal narratives was used as a method for qualitative assessment.The percentage of IMGs clearing their exams and getting jobs in the NHS has been used for quantitative assessment.ResultQualitative: The personal narratives of the IMGs show how they were positively impacted by staying together albeit different nationalities and cultural background.Quantitative: A total of 21 IMGs out of the 26 cleared their PLAB 2 exams and got registration under General Medical Council giving a percentage of 81.7%. 20 IMGs have successfully joined the NHS in various posts giving a job success rate of 95.2%.ConclusionThe experience of living and sharing housings with people from different nationalities, has increased appreciation and also prepared them to work in the NHS which has a diverse work force. This learning experience has been integral for all of us in shaping our life in the UK making everyone more compassionate.

The COVID-19 Period: A Crisis for on-Site Learning or an Opportunity for Optimal Distance Learning? Examination of Student Attitudes

This study, which explores student attitudes to online learning, is based on a psychoanalytic theory (Existence-relatedness-growth, ERG) on relatedness and growth, developed by American psychologist Clayton Alderfer. The purpose of the study was to examine whether online learning is merely a short-term temporary solution necessitated by the COVID-19 crisis, or will it enable a transformation of teaching and learning patterns in educational systems in the post-COVID era? What is students’ personal preference regarding online learning after having inadvertently experienced it? What dimension of online teaching was meaningful for them: social presence, instructional-cognitive presence, emotional-personal presence? The research population consisted of 306 students, with a mean age of 15.5. Only 85% of the students who participated in the study had technological resources for online learning at home. About 41% of the students preferred lessons that combine online teaching with frontal teaching in the classroom. In addition, the dimensions of online teaching reported by students as meaningful were, in descending order, social presence (M = 3.54), emotional-personal presence (M = 2.96), and instructional-cognitive presence (M = 2.73). The research findings might have an effect on policy makers in education with regard to maintaining an “innovative pedagogy” aimed at shaping students’ image in order to prepare them for the new post-COVID era. In this period of global crisis, online learning afforded students innovative learning, where students enhanced their awareness of the significance of social presence, which was more meaningful than the dimension of instructional-cognitive presence. The significance of interpersonal interaction in teaching and learning received support, more so than ever before.

THE COVID-19 PERIOD: A CRISIS FOR ON-SITE LEARNING OR AN OPPORTUNITY FOR OPTIMAL DISTANCE LEARNING? EXAMINATION OF STUDENTS’ ATTITUDES

This study, which explores student attitudes to online learning, is based on a psychoanalytic theory (Existence-relatedness-growth, ERG) on relatedness and growth, developed by American psychologist Clayton Alderfer. The purpose of the study was to examine whether online learning is merely a short-term temporary solution necessitated by the COVID-19 crisis, or will it enable a transformation of teaching and learning patterns in educational systems in the post-COVID era? What is students’ personal preference regarding online learning after having inadvertently experienced it? What dimension of online teaching was meaningful for them: social presence, instructional-cognitive presence, emotional-personal presence? The research population consisted of 306 students, with a mean age of 15.5. Only 85% of the students who participated in the study had technological resources for online learning at home. About 41% of the students preferred lessons that combine online teaching with frontal teaching in the classroom. In addition, the dimensions of online teaching reported by students as meaningful were, in descending order, social presence, emotional­personal presence, and instructional-cognitive presence. The research findings might have an effect on policy makers in education with regard to maintaining an "innovative pedagogy" aimed at shaping students’ image in order to prepare them for the new post-COVID era. In this period of global crisis, online learning afforded students innovative learning, where students enhanced their awareness of the significance of social presence, which was more meaningful than the dimension of instructional-cognitive presence. The significance of interpersonal interaction in teaching and learning received support, more so than ever before.

Influence of the global crisis of 2008 and the brazilian political oscillations of 2014 on suicide rates: An analysis of the period from 2002 to 2017.

Global suicide rates have increased in recent decades becoming a serious social and public health problem. In Brazil, rates have been increasing annually. We aimed to analyze the correlation between suicide mortality rates and global economic and political crisis periods of 2008 and 2014 in Brazil. The analysis of suicide mortality in Brazil was done using a time-series segmented linear regression model that estimated the trend of rates over time. To obtain the model, changes in the trend of both abrupt and gradual suicide rates were investigated. The results indicate statistically significant changes showing an upward trend of suicide rates during the world economic crisis (2008-2013) and during the economic and political crisis in Brazil (2014-2017) compared to previous periods, especially at the extremes of schooling (3 < years and > 8 years). Among white and parda, there were significant trend rates increases in both periods and in different regions. In the Northeast and South regions, we observed a significant increase in the trend rate for males after the Brazilian economic and political crisis (2014 to 2017). We can conclude that the national suicide rates were influenced by the economic and political instability that our country has been going through since 2008, affecting each region differently. Further studies are needed to explore the reasons for interregional differences and the relation of suicide with unemployment rates and possible economic predictors.

Reproduction of Communicative Negativity Through Instrumental Irrationality

This paper aims to use Turkey as an ex­ample of how the erosion occurring in social communication practices is repro­duced in the era of paradoxical experi­ences, particularly in global crisis envi­ronments where risk intensity increases. Recently, ‘the great incarceration’ situa­tion around the world has forced people to receive news and connect to them via digital platforms. The isolation of social relations for an indefinite period, espe­cially in risk society, causes people to feel constantly under pressure from an un­foreseen/indeterminate threat. The in­crease in the level of anxiety of the indi­vidual under pressure, internalizing fear after a while, turns him/herself into the very mechanism that produces anxiety and fear. This mechanism causes society to become paralyzed as a result of in­creased information pollution and the amount of information during global crisis periods. The paper examines how the negativity in communication has been exploited through the media with crises in different institutional areas —political, economic, and social— re­cently, in the framework of the terms of risk and trust used by Giddens and Beck’s risk society theory. From this point on, the paper focuses on the con­sequences of the mutual relationship between global crisis, fear culture and the new modern period. Keywords: COVID-19, global crisis, info­demic, risk society, sociology of commu­nication, media.

Interpretable OR for High-Stakes Decisions: Designing the Greek COVID-19 Testing System

In the summer of 2020, in collaboration with the Greek government, we designed and deployed Eva – the first national scale, reinforcement learning system for targeted COVID-19 testing. In this paper, we detail the rationale for three major design/algorithmic elements: Eva’s testing supply chain, estimating COVID-19 prevalence, and test allocation. Specifically, we describe the design of Eva’s supply chain to collect and process thousands of biological samples per day with special emphasis on capacity procurement. Then, we propose a novel, empirical Bayes estimation strategy to estimate COVID-19 prevalence among different passenger types with limited data and showcase how these estimates were instrumental for a variety of downstream decision-making. Finally, we propose a novel, multi-armed bandit algorithm that dynamically allocates tests to arriving passengers in a non-stationary environment with delayed feedback and batched decisions. All of our design and algorithmic choices emphasize the need for transparent reasoning to enable human-in-the- loop analytics. Such transparency was crucial to building trust and buy-in among policymakers and public health experts in a period of global crisis.

Manipulator Detection in Cryptocurrency Markets Based on Forecasting Anomalies

Today, there are constant changes in terms of securities in stock markets. In these stock market investments, investors use fundamental analysis tools and indicators very widely. In this way, it is possible to have some knowledge of the situations experienced in the markets and to make a profit. In this study, manipulations on Bitcoin are discussed. Popular machine and statistical forecasting methods have been used to detect these manipulations and the road maps to be followed in order to be detected in the most successful way have been shared. Social media sentiments, which were thought to have an effect on manipulations during the studies, were also evaluated with the most advanced text analysis methods and evaluated together with these price changes. The allegations that the prediction methods carried out before the crisis were more successful were investigated. The Covid-19 pandemic was evaluated as a period of global crisis and the studies that might be relevant were examined. It would not be wrong to say that the actors that make big gains in the stock markets are the ones that determine the direction of the stock market. The manipulation periods of the market actors to be successful in the virtual money markets have been tried to be verified by various estimation methods. These estimations can achieve up to F <sub xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">1</sub> score of 93% success according to our experimental result. Besides, it is stated that accounts with the highest volume of transactions in the periods, when anomalies were detected, were labeled as potential manipulators.

Analyst Confirmation of Management Forecast Credibility During a Global Crisis

This paper examines whether textual management forecast commonalities that arise in a global crisis setting relate to ex post forecast accuracy, and whether subsequent analyst revisions confirm the credibility relevance of these commonalities. This approach is motivated by two conclusions. First, extant studies focus on general commonalities such as external (vs. internal) attributions, instead of specific subsets of these regularities that have the capacity to affect many management forecasts at the same time. Second, studies seldom focus on global crisis periods, although they acknowledge that those periods serve as catalysts for creating measures to assess management forecast credibility. After arguing that sales forecasts are most directly affected by global crisis conditions, I predict and find that management who attribute their sales forecasts (in full or in part) to the global crisis issue forecasts that are more accurate ex post. This finding is not consistent with the common assumption that external attributions are not based on skill and effort, and consistent with theoretical models of signaling and management ability. Furthermore, the ‘crisis’ attribution gives rise to a dictionary-free alternative to the linguistic tone measure which is related to ex post forecast accuracy. Analyst confirmation of the credibility relevance of these two measures suggests that they are useful for future research. Policy makers and regulators should find these results interesting as they offer new ways to improve the comparability of management forecasts.

A time–frequency analysis of the impact of the Covid-19 induced panic on the volatility of currency and cryptocurrency markets

We apply wavelet analyses to examine the impact of the Covid-19 fueled panic on the volatility of major fiat and cryptocurrency markets during January–May, 2020. There is high coherence between moves of the Coronavirus Panic Index and the price moves in Euro, British pound, and Renminbi currencies as well as movements of the Bloomberg Galaxy Crypto Index. The main conclusions for each index pair are quite similar and corroborate with our thesis that the cross-currency hedge strategies, which could work under normal market conditions, are likely to fail during the periods of global crisis, e.g., such as the Covid-19 pandemic. However, we document some important differences in currency markets behavior, which potentially could be used to design effective cross-currency hedges capable of withstanding adverse impacts of global financial and economic turmoil. Our findings could be of use for future development of financial policies and currency markets regulation rules.